Minimum Required Investments Increased

On March 10, 2022, Congress passed the $1.5 billion omnibus appropriations bill, which includes the EB-5 Reform and Integrity Act of 2022. The bill is currently awaiting President Biden's signature. The Appropriations Act renews the EB-5 program for five years through 2027 and raises the minimum investments required.

Background

The EB-5 program was established to promote economic growth. It allows the foreign investor to obtain a green card either through direct investment in a US business (one the investor operates himself) or, as one of many, by investing in a large project — typically a hotel, an office building or the like — known as a regional center (passive investor). There are minimum investment amounts and U.S. job creation requirements.

New Law

Most significantly, the minimum investments have been raised: $800,000 (formerly $500,000) minimum investment if invested in a high unemployment Targeted Employment Area (TEA); and $1,050,000 (previously, $1,000,000) minimum investment if invested outside of a TEA. Details The EB-5 Regional Center Program expired in June 2021. Since then, applicants have been unsure of their status and rights. The EB-5 Reform and Integrity Act of 2022 provides clarity and protection for these applicants and will make the following changes:

• EB-5 Regional Center Program reauthorized through September 30, 2027;

• Department of Homeland Security determines what qualifies as a TEA;

• $800,000 minimum investment if invested in a TEA;

• $1,050,000 minimum investment if invested outside of a TEA;

• The minimum investment amounts re-adjust for inflation every five years, beginning with 2017;

• 20% of EB-5 visas allocated to investment in rural areas, 10% of EB-5 visas allocated to investment in high-unemployment areas and 2% of EB-5 visas allocated to infrastructure (government public works) projects;

• Adjustment of Status available for new I-526 applicants already residing in the U.S.;

• New protections for children who reach age 21 during the EB-5 visa process;

• New fees and faster processing times;

• Integrity and reform protections to monitor and ensure the integrity of the Regional Center Program;

• Clarification on source of funds pertaining to gifts and administration fees;

• Processes put in place for reallocation of investment capital if a regional center or new commercial enterprise closes.

The new bill affirms that those who previously participated in the EB-5 Regional Center Program will be protected and their applications will be processed.

Please contact an RACC members that practices law for further details.